Bitcoin bubble re-inflates

Bitcoin prices are back in rally mode, just one week after it looked like the bubble had started to burst.

Early Friday, Bitcoin prices traded as high as $136.43 before pulling back to $119.36. That's more than double this week's low of $50.

Trading volume doubled in just two hours.

The price of the virtual currency, which was created by an anonymous hacker just four years ago, has increased almost 20-fold this year. It gained particular attention in the wake of a mini-bank run in Cyprus, which had raised concerns about the health of government-backed paper currencies like the euro and the U.S. dollar.

As traders and investors jumped on the bandwagon, prices spiked to $266.

The rush of activity led Mt. Gox, a Japan-based exchange that claims to handle 80% of Bitcoin trade worldwide, to halt trading.

Prices came down sharply when trading resumed, leading to speculation about whether the Bitcoin bubble had finally burst.